Gregg Eviscerates Orszag
God bless Sen. Judd Gregg for eviscerating OMB Director Peter Orszag during yesterday’s Senate Budget Committee hearing. Here’s what Sen. Gregg said in response to Director Orszag’s tesimony:
While President Obama was visiting Nashua, Gregg’s birthplace, the three-term senator was on Capitol Hill skewering Peter Orszag over the plan to funnel $30 billion from the Troubled Asset Relief Program.
Gregg erupted as Orszag spoke of the TARP use to solve lingering problems with access to credit for small businesses. “No! No! No!” he yelled out. “You can’t make that type of statement with any legitimacy. You cannot make that statement.” Gregg then held up a guideline for the TARP, which he helped write in 2008 to keep the country from further economic collapse.
“This is the law,” he said. “Let me tell you what the law says. Let me read to you again because you don’t appear to understand the law. The law is very clear. The monies recouped from the TARP shall be paid into the general fund of the Treasury for the reduction of the public debt. It’s not for a piggy bank because you’re concerned about lending to small businesses and you want to get a political event when you go out and make a speech in Nashua, N.H.”
Gregg accused Orszag and Obama of passing on debt to generations of Americans and having an abashed sidestepping of the TARP law. “And,” he said, “you ought to at least have the integrity to be forthright about it.”
The legislation that established TARP is very specific. Once the money is repaid, that money goes into the general fund. It’s against the law to use the repaid money as a slush fund to be spent on whatever this administration wants to spend it on. PERIOD.
Under further questioning from Gregg, Orszag said the administration would be seeking congressional approval. Then Sen. Bernie Sanders, I-VT, chimed in, “That is how laws are made usually, Congress passes them.”
Gregg fired back, “Did the senator from Vermont make a statement? Well the senator is wrong. This is the law as it stands today. There is no law on the books.”
This administration and their progressive allies in Congress have this nasty habit of running roughshod on the laws of this country, especially if those laws stand in the way of President Obama’s ability to recklessly spend money at unsustainable rates. Thank God that people of the intellectual heft of Sen. Gregg still serve in the Senate. Sen. Gregg is the taxpayer’s watchdog. For that alone, I’ll grant him hero status.
Orszag, whose official title is director of the Office of Management and Budget, appeared before the committee to testify on the President’s 2011 budget. In his prepared remarks, Orszag placed much of the blame on the country’s budget deficit on the Bush administration.
It’s getting old to hear President Bush get blamed for everything that’s wrong with the US economy and the federal government’s budget deficits. It simply doesn’t pass the laugh test. The administration and the congress that passed two omnibus spendin bills, the failed stimulus bill and a budget that runs up trillions of dollars of debt over the next decade simply don’t have any credibility as being fiscally responsible.
President Bush wasn’t a fiscal conservative by any stretch but it wasn’t his signature that turned this administration’s failed stimulus bill into law. It wasn’t President Bush’s signatures that turned the Democratic Congress’s omnibus spending bills into a 25 percent spending increase of the federal budget. This administration and the Democratic majority’s reckless spending habits are documented facts. This isn’t theory. This isn’t speculation.
Dick Morris’s column puts the administration’s argument to rest. Here’s the important statistics:
President Obama is being disingenuous when he says that the budget deficit he faced “when I walked in the door” of the White House was $1.3 trillion. He went on to say that he only increased it to $1.4 trillion in 2009 and was raising it to $1.6 trillion in 2010.
Congressman Joe Wilson might have said “you lie,” but we’ll settle for “you distort.”
(As Mark Twain once said, there are three kinds of lies: “lies, damn lies, and statistics.”)
Here are the facts:
In 2008, Bush ran a deficit of $485 billion. By the time the fiscal year started on October 1, 2008, it had gone up by another $100 billion due to increased recession-related spending and depressed revenues. So it was about $600 billion at the start of the fiscal crisis. That was the real Bush deficit.
But when the fiscal crisis hit, Bush had to pass TARP in the final months of his presidency which cost $700 billion. Under the federal budget rules, a loan and a grant are treated the same. So the $700 billion pushed the deficit, officially, up to $1.3 trillion. But not really. The $700 billion was a short term loan. $500 billion of it has already been repaid.
So what was the real deficit Obama inherited? The $600 billion deficit Bush was running plus the $200 billion of TARP money that probably won’t be repaid (mainly AIG and Fannie Mae and Freddie Mac). That totals $800 billion. That was the real deficit Obama inherited.
Then…he added $300 billion in his stimulus package, bringing the deficit to $1.1 trillion. This $300 billion was, of course, totally qualitatively different from the TARP money in that it was spending not lending. It would never be paid back. Once it was out the door, it was gone. Other spending and falling revenues due to the recession pushed the final numbers for Obama’s 2009 deficit up to $1.4 trillion.
The deficit that President Obama inherited was the biggest in history to that point. Now he’s exploded that deficit, surpassing it by $620,000,000,000.
People aren’t buying this administration’s talking points that it’s all President Bush’s fault because it isn’t all his fault. This administration and this Democratic Congress certainly played a major role in doubling the deficits they inherited from the Bush administration.
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